Problem 4-2 Discontinued operations [LO4-4] The following condensed Income statements of the Jackson Holding Company are presented for the two years ended December 31, 2018 and 2017 2818 2017 Sales Cost of goods sold Gross profit Operating expenses Operating income Gain on sale of division $16,680,8e8 $11,28e,8ee e,8e8 4,488,888 e,0ee 1,16e,888 18,800,000 6,80 6,688,8e8 3,848,80e 3,24 2,76e,888 760,8e8 3,528,8e8 1,168,8ee 348,888 2,464,8e8 812,8ee Income tax expense 1,856,8ee Net income On October 15, 2018, Jackson entered Into a tentative agreement to sell the assets of one of its divislons. The division qualifies as a component of an entity as defined by GAAP. The division was sold on December 31, 2018, for $5,480,000. Book value of the division's assets was $4,720,000. The dlvisIon's contribution to Jackson's operating Income before-tax for each year was as follows: 2818 $48e,8ee 2817 $380,800 Assume an income tax rate of 30%. Required: (In each case, net any galn or loss on sale of dlvision with annual Income or loss from the division and show the tax effect on a separate line) 1. Prepare revised Income statements according to generally accepted accounting principles, beginning with Income from continulng operations before Income taxes. Ignore EPS disclosures. 2. Assume that by December 31, 2018, the division had not yet been sold but was considered held for sale. The falr value of the dlvision's assets on December 31 was $5,480,000. Prepare revised Income statements according to generally accepted accounting principles, beginning with Income from continulng operations before Income taxes. Ignore EPS disclosures 3. Assume that by December 31, 2018, the division had not yet been sold but was consldered held for sale. The falr value of the